Northwestern Mutual Offers New Retirement Income Solutions to Navigate Longevity Risk

MILWAUKEE, Oct. 2, 2014 /PRNewswire/ -- American adults are challenged today by longevity risk and many don't feel fully prepared for financial security in retirement, according to Northwestern Mutual's 2014 Planning and Progress Study , an annual research project that explores Americans' attitudes and behaviors toward finances and planning. Based on their current financial condition, future prospects and long term plan:

• One-quarter (26%) of adults age 25 and older do not believe they'll be financially prepared to live to the relatively young age of 75, based on their current financial condition, future prospects and long term plan
• One-third (32%) don't believe they'll be financially prepared to live to 85
• And nearly 40% don't believe they'll be financially prepared to live to 95

"While there's growing awareness of the need to plan for long term financial security, there's often uncertainty about how to do so, especially when it comes to navigating longevity risk and the concern about outliving one's retirement savings," says David Simbro, senior vice president life and annuity product, Northwestern Mutual. "Annuities are really the only financial tool that can create guaranteed lifetime income, which is especially important to those without traditional pensions."¹ 

Recognizing Americans' need for future retirement income, Northwestern Mutual is expanding the availability of its Select^TM Portfolio Immediate Income Annuity and Select^TM Portfolio Deferred Income Annuity.  These innovative products, initially introduced in 2012 for tax-qualified dollars, are now available to individuals who would like to leverage their personal savings outside of their qualified retirement dollars.

"Our Portfolio Income Annuities have been very popular for clients using funds from their IRA and 401k savings plans. Now, individuals can allocate some of their personal savings—such as a lump sum from an inheritance or the sale of a home or business—to create a lifetime income with the potential for growth over time," explains Simbro.

Select^TM Portfolio Immediate Annuity and Select^TM Portfolio Deferred Income Annuity

Since their launch, the Portfolio Income Annuity product suite has experienced double digit growth, surpassing more than $1 billion in sales as of August 2014., giving Northwestern Mutual about 20 percent market share. 

The Portfolio Income Annuity products help individuals plan and protect themselves against some of the most significant challenges to a successful retirement, including longevity risk, market risk and inflation risk.  These unique, patent-pending products have the potential to receive dividends that can be used to purchase additional income, helping to alleviate the concern of locking in payments from a fixed income annuity in a low interest rate environment.²

"Navigating these risks and creating one's own lifetime income can be tough, so we recommend working with a trusted financial professional who can help create a comprehensive plan tailored to an individual's own circumstances," suggests Simbro.   

More about the Select^TM Portfolio Immediate Income Annuity and Select^TM Portfolio Deferred Income Annuity can be found here.

Individuals can also try Northwestern Mutual's Lifespan Calculator, which provides insights into potential longevity to help people think about their long term financial planning needs.

About the Research
The 2014 Planning and Progress Study explores the state of financial planning in America today, and provides unique insights into people's current attitudes and behaviors toward money, goal-setting and priorities.

This study was conducted by Harris Poll on behalf of Northwestern Mutual and included 2,092 American adults aged 18 or older (of which, 1,915 are aged 25 or older) who participated in an online survey between January 21, 2014 and February 5, 2014.  Results were weighted as needed for age by gender, education, race/ethnicity, region and household income. Propensity score weighting was also used to adjust for respondents' propensity to be online.  No estimates of theoretical sampling error can be calculated; a full methodology is available.

About Northwestern Mutual
Northwestern Mutual has been helping families and businesses achieve financial security for nearly 160 years. Our financial representatives build relationships with clients through a distinctive planning approach that integrates risk management with wealth accumulation, preservation and distribution. With more than $217 billion in assets, $26 billion in revenues and more than $1.5 trillion worth of life insurance protection in force, Northwestern Mutual delivers financial security to more than 4.2 million people who rely on us for insurance and investment solutions, including life, disability and long-term care insurance; annuities; trust services; mutual funds; and investment advisory products and services.

Northwestern Mutual is the marketing name for The Northwestern Mutual Life Insurance Company, Milwaukee, WI, and its subsidiaries. Northwestern Mutual and its subsidiaries offer a comprehensive approach to financial security solutions including: life insurance, long-term care insurance, disability income insurance, annuities, investment products, and advisory products and services. Subsidiaries include Northwestern Mutual Investment Services, LLC, broker-dealer, registered investment adviser, member FINRA and SIPC; the Northwestern Mutual Wealth Management Company, limited purpose federal savings bank; Northwestern Long Term Care Insurance Company; and Russell Investments.

An income annuity has no cash value.

¹All annuity guarantees are backed solely by the claims-paying ability of Northwestern Mutual.

²Dividends are not guaranteed.

SOURCE Northwestern Mutual